Malaysian PM cleared of wrongdoing over $681m donation

Najib returned $620m to the Saudis as the money was not utilised, attorney general says [Joshua Paul/AP]

Malaysia's Attorney General said on Tuesday that $681m transferred into Prime Minister Najib Razak's personal bank account was a gift from the royal family in Saudi Arabia and there were no criminal offences or corruption involved.

"I am satisfied with the findings that the funds were not a form of graft or bribery," Attorney General Mohamed Apandi Ali told a press conference.

"There was no reason given as to why the donation was made to PM Najib. That is between him and the Saudi family," he said.

He said no criminal offence was committed by Najib in relation to three investigations submitted by Malaysia's anti-graft agency, and no further action would be taken.

Najib returned $620m to the Saudis as the money was not utilised, he said.

Najib has been under fire since the donation came to light last July, along with billions of dollars in debt built up by state investment fund 1Malaysia Development Berhad.

Despite it all, the prime minister remained steadfast, vehemently denying any wrongdoing, and rejecting calls for his resignation.

Najib said the announcement "confirmed what I have maintained all along: that no crime was committed".

"This issue has been an unnecessary distraction for the country," Najib said in a statement. "Now that the matter has been comprehensively put to rest, it is time for us to unite and move on."

The scandal has shaken investors in Southeast Asia's third-biggest economy and rocked public confidence in the coalition led by Najib's United Malays National Organisation party, which has held power since independence in 1957.

Al Jazeera's So Rahman, reporting from Kuala Lumpur, said the attorney general's announcement was unlikely to turn down the political heat on Najib.

"This issue is not going die. Malaysia is heading towards a general election within the next two years. It will be interesting to see how the opposition reacts, and how the ruling party reacts too. Even some of the back-benchers within the ruling party were very unhappy," said Rahman.